Which of the following terms is used to describe a situation in which the government finances public goods that are underproduced because non-payers cannot be excluded from enjoying the goods? a.) Externality failure b.) Asymmetric failure c.) Government failure d.) Market failure

(Optimal Provision of Public Goods) Using at least two individual consumers, show how the market demand curve is derived from individual demand curves (a) for a private good and (b) for a public good. Once you have derived the market demand curve in each case, introduce a market supply curve and then show the optimal level of production.

A)  Using demand and supply diagram, describe and discuss positive externality in production of a product/service. In your discussion, explain why the existence of a positive externality leads to inefficiency. B)  Consider your answer in part (a), discuss two methods that the government may use to intervene in the market to eliminate the market inefficiency. In your discussion, explain which method is preferred.

i)A public good a )costs essentially nothing to produce and is thus provided by the government at a zero price. b)can never be provided by a nongovernmental organization. c) can't be provided to one person without making it available to others as well. d)generally results in substantial negative externalities. ii)The market demand curve for a public good a) shows the total value that all individuals place on each additional unit of the good. b) is derived in the same manner as demand curves for private goods. c)is derived by horizontally summing all individual demand curves. d)shows the total number of units that would be produced by the public sector at each possible price. iii)The market demand curve for a public good a) shows the total value that all individuals place on each additional unit of the good. b)is derived in the same manner as demand curves for private goods. c) is derived by horizontally summing all individual demand curves. d)shows the total number of units…